China Passes Medical Security Law to Anchor Universal Healthcare System

China's top legislature has adopted the Medical Security Law, setting a foundational legal framework for the country's multi-tiered universal healthcare system. Passed on August 28, 2026, by the Standing Committee of the National People's Congress, the legislation defines citizen rights and obligations regarding basic medical insurance, delineates employer and employee contributions, and structures fiscal subsidies for rural and non-working urban residents. Scheduled to take effect on January 1, 2027, the law also mandates greater administrative coordination across healthcare services, insurance funds, and pharmaceutical regulation.

The law clarifies the statutory rights and obligations surrounding universal participation in basic medical insurance, providing a higher-level legal basis for fund financing, public subsidies, and tiered healthcare services. It directly impacts individual healthcare entitlements and institutionalizes the financial security and governance of the national medical insurance fund.

China's highest legislative organ has approved the Medical Security Law, establishing a comprehensive legal charter to standardize universal healthcare coverage, safeguard citizens' entitlements, and regulate the operations of medical insurance funds nationwide. The law was adopted on August 28, 2026, at the 24th session of the Standing Committee of the 14th National People's Congress, according to People's Daily, and will come into force on January 1, 2027. Formulated pursuant to the Constitution, the statute applies to fundraising, benefit disbursement, public services, fund utilization, and supervisory oversight across China. Where issues remain unaddressed by the new statute, provisions from existing legal frameworks, such as the Social Insurance Law, will continue to govern. The law stipulates that healthcare security must remain people-centered, adhere to the leadership of the Communist Party of China, and operate under principles of universal coverage, urban-rural coordination, equity, and fiscal sustainability commensurate with economic development. Under the statute, citizens have both the right and the legal obligation to participate in basic medical insurance. The architecture maintains two primary pillars: basic medical insurance for urban employees and basic medical insurance for non-working urban and rural residents. For formal employees, contributions will continue to be shared jointly between employers and workers, with contribution baselines set by local authorities under national guidelines. The law also encourages self-employed individuals, non-full-time workers, and flexible employment personnel to enroll in employee insurance, assigning the State Council's medical security authority the mandate to issue detailed implementation rules. For citizens not covered under the employee system or other state-backed programs, participation in the resident insurance scheme is mandatory. Financing for resident coverage combines personal contributions with government subsidies. The statute dictates that contribution rates must align with local economic indicators and per capita disposable income, giving provincial-level governments the authority to set or guide local standards. Furthermore, county-level governments and above are tasked with advancing integrated management and reform across medical services, health insurance, and the pharmaceutical industry.